A collection of private foundations and nonprofits invested $24 million in December to form the Elevation Community Land Trust, which aims to provide affordable homeownership options for low-income families in the Denver metropolitan area.
Community Land Trusts Split Property and Land Rights
The community land trust (CLT) aims to accumulate 700 dwellings in the form of single-family homes, condominiums, townhomes and other types of property over the next five years. The trust will then sell the homes to families who meet a certain income deficit, while retaining ownership of the land, and the homeowners would pay to lease the land from the trust.
By “decoupling” the land from the home, the trust is able to sell the home at lower price to families who would be hard-pressed to afford it.
According to Dave Younggren, the president and CEO of Denver-based Gary Community Investments, CLTs “support low-income families in safely bridging the gap between rental housing and homeownership, allowing them to increase their savings and assets, improve their financial literacy and ultimately become more economically self-sufficient.”
Unlike other forms of low-income homeownership options, there is no limit to how long a family can own a home and lease the land from the community land trust.
Community Land Trusts Offer a Solution to Rising Home Costs
Affordable housing options are a highly sought-after commodity in Denver, where home prices have risen 11.6 percent, according to the Denver Metro Association of Realtors, with an average home price of $490,525.
Income requirements for the Elevation Community Land Trust have not been finalized, but are estimated to span “$36,960 to $53,760 for a two-person household and $46,145 to $67,120 for a family of four,” according to the Denver Post.
Because community land trusts have no lease expirations or restrictions, the homes purchased by low-income families will stay affordable, regardless of how long they live at the property. If and when residents decide to sell the home back to the community trust, they will be entitled to a portion of the appreciated value.
Community land trusts, unlike other affordable-housing tools and models and programs, really create permanent affordability,” says Tony Pickett, vice president of master site development at Denver’s Urban Land Conservancy (ULC).
Land Trusts are Spreading Throughout Colorado
There are an estimated 200 community land trusts operating in the U.S., six alone in Colorado, with more expected to form as popularity and need rises.
The ULC has a land lease for an apartment complex near the Sheridan West Line station with plans for other leased developments near the 38th and Blake transit station.
The Colorado Community Land Trust was created in Lowry in 2004, and has been developing homes ever since, with 14 units hitting the market in 2017.
With help from the National Community Land Trust Network, interested parties can learn the best way to form a CLT, legal requirements and how to be successful.